Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1887-01-12
THE INTERSTATE COMMERCE DEBATE.

Senator Stanford, in his logical, forcible
and convincing argument against the in
terstate commerce bill, gave the deliberate
weight of his testimony, long experience
and sound Judgment to the claim that the
long and short haul provision (Section A.
will have the effect Of driving through
traffic to steamship lines. As result of
that, the local rates on transcontinental
railways must bear the cost of maintenance
of the roads. How long the people will
endure such substituting of steamship lines,
and discrimination against lines of rail
way, in case the bill becomes law, will
be the chief matter of interest after it goes
into operation.
Senator Stanford points out that control
is the essence of ownership; the state, if it
seizeS property under its power of eminent
domain, does so only after making due
compensation, and only when it is neces-
sary for the good of the state But if the
interstate commerce bill strikes at the
earning capacity of an industry in every
way legitimate, 1t is in the nature of seiz-
ure without compensation. Railway lines
do not possess exclusive privileges; they
are the result of investment and labor
they are therefore entitled to their legiti-
mate reward the same as any other indus
try, whether it be farming or blacksmith
ing. Why then should the Governmenti in
terfere with them to the extent of cutting off
the earning capacity and limiting the right
toconduct their and transferring their legiti-
mate business to other lines If it does
these things, why should it not respond IN
compensation to the owners thus deprived
of natural and guaranteed rights?
That railroads, says the Senator, ever
carry goods or passengers long distance
for less than for a short distance is due to
competition between the points affected,
and the rate thus made never was and
never will be considered the true measure
of charge for hauls between the two ter
minal or competitive points,
He declares that no road rejects bust
ness that can possibly be DONE SO
long as it will pay the additional ex-
pense consequent upon its own movement.
Dat of this fact is born the through or
competitive rate system, and because of
this arises the fact that a large portion of
the traffic Of the country is done below
average cost. This also accounts for APP
parent discrimination, but which in reality
are not at all discriminating except against
the carrier. For it must be apparent to the
dullest that ii 4 carries from Station
to Station 10 a toR Of goods for $40, in
order to compete with b, who operates a
rival carrier line between the two stations,
c has no cause Of complaint at Station ).
where BIS carrier line does not touch, if A
charges him the true value for hauling a
ton Of goods to the intermediate station,
though the charge exceeds that on the
same amount and kind of goods between
the two terminal stations. The reasona-
bleness of the charge, in other words, is
the only thing to concern {, not what his
more fayorably-situated neighbor at the
terminal point may gain by reason of Iiv-
ing where rival lines of carriage meet.
The suggestions case we have interpolated
is illustrative of the principle involved,
and which Senator Stanford makes much
clearer: Thus, he says, all overland roads
lind rates largely controlled by the ocean
carrier rates To meet the competition
they accept the very small profit on goods
hauled between the points where the
competition develops naturally at less
rates, indeed, than goods are carried to in
termediate places. This is because thev
act upon the principle that no profit is
too small to be deSpised.
An illustration is given by the Senator
The Southern Pacific Company is in COM
petition with northern rivals and water
routes for through business between the
Atlantic and Pacific tides. 1t has line of
easy gradients and is operated at some
thing less of cost than roads crossing
greater elevations. Now, because of COM
petition by rail and by water, it takes
freight, at times as low as $40, while half
way freights may be rated at $50 ton,
though the local business of the sparsely-
settled country is exceedingly light. Sup
pose now, said the speaker, that the road
makes but 81 ton on the $40 rate, it is
better that it do that than let the traffic gs
from it-but the ton of freight going half
way, to point not touched by competi-
lion, pays as much profit to the carrier as
q tons going through. Yet the statistics
of the gross earnings and gross expenses
demonstrate that the rate to the halfway
station is fair, and leaves but narrow
profit In other words, the shorter distance
is not charged any more, because Of the less
rate jor Tie longer distance. The longer haul